A-SOLDIERS-JOURNEY.CO.UK, a high-profile charity that raises funds for military charities, gave less than 14% (i.e. only £47 075) of its £347 496 income to charities in the year to 30 September 2015. Fundraising costs were excessive at more than 83% (i.e. £288 663) of the funds raised. Founder and trustee, Sgt Rick Clement, has just announced that the charity is to close on 1 September 2016, primarily because, he says, paid staff are necessary to continue – and he doesn’t want any of the funds raised in the name of wounded soldiers to be used for “wages and other costs.” Laudable, but strange: the charity already works with a professional fundraiser. Even more importantly, why is the charity spending too much on fundraising?

In October 2015, I exclusively revealed that the then latest accounts for Blackpool charity A-SOLDIERS-JOURNEY.CO.UK (registered charity number: 1149233) hid both the cost of generating funds and the involvement of a professional fundraiser (see my 19 October 2015 post). So the accounts, for financial year-end (FYE) 30 September 2014, considerably overstated the expenditure on charitable activities. Now, for the first time, cost of generating funds is explicitly disclosed in the most recent accounts, for FYE 30 September 2015 – and it’s unreasonable at more than 83% (i.e. £288 663) of the £347 496 income.

The charity operates by making grants to both individuals and organisations, according to the Charity Commission public register. Yet no grants were made to individuals in the year to 30 September 2015. While less than 14% (i.e. only £47 075) of the £347 496 income was donated to military charities, a shockingly low figure.

Meanwhile, the charity’s official professional fundraiser, A Soldiers [sic] Journey Events Limited, changed name again on 31 March 2016, according to filings at Companies House (registered company number: 08897182). It’s now called Camo Events Limited. The company is linked to Prize Promotions Limited of Blackpool, the rip-off professional fundraiser that worked with failed military charity Afghan Heroes (registered charity number: 1132340). (For a review of the company, see my 19 October 2015 post.)

A-SOLDIERS-JOURNEY.CO.UK isn’t a member of the official umbrella organisation for military charities, the Confederation of Service Charities (Cobseo).

Sgt Clement was seriously injured in Afghanistan in April 2010, aged 30. “I lost both my legs and almost my right arm as well as suffering massive internal injuries that left me unable to have children after stepping on an IED,” he says on the charity website. Registered as a charity on 5 October 2012, A-SOLDIERS-JOURNEY.CO.UK has received much favourable coverage in local and national media due to Sgt Clement’s injuries and subsequent recovery. But no charity should be beyond scrutiny.

On 10 August 2016, the Blackpool Gazette reported Sgt Clement’s decision to close the charity on 1 September 2016: http://www.blackpoolgazette.co.uk/news/hero-soldier-winding-down-charity-mission-1-8059257. (The exact date of closure is on the charity website, not in the report.) Why closure? Primarily because, he says, paid staff are necessary to continue – and he doesn’t want any of the funds raised in the name of wounded soldiers to be used for “wages and other costs.” Laudable, but strange: the charity already works with a professional fundraiser. Even more importantly, why is the charity spending too much on fundraising?

Money raised by charity Our Local Heroes Foundation (OLHF) was used to fund work at a company owned by the charity founder, who’s also chief executive and president of the charity. A trustee of OLHF, with the same surname as the charity chief executive, is also director of the company. In 2014, I exclusively exposed OLHF for both its excessive fundraising costs and highly misleading ways of working when fundraising. Nevertheless it wasn’t until March 2016 that the Charity Commission published a highly critical “case report” on the charity, identifying “serious regulatory concerns”. Here I now show, too, that there’s a lack of clarity and transparency around the relationships between OLHF and the complex web of companies owned by the charity founder, Steve Pearson. Finally, links between the new chair of the charity and Mr Pearson demonstrate that questions remain about the governance of OLHF.

Hitherto I‘ve examined the fundraising activities only of OLHF, a military charity based in Bamber Bridge, Preston (registered charity number: 1142029). It isn’t a member of the official umbrella organisation for military charities, the Confederation of Service Charities (Cobseo). In 2014, I exclusively exposed the charity for both its excessive fundraising costs and highly misleading ways of working with a rip-off professional fundraiser, Prize Promotions Limited of Blackpool (PPL; registered company number: 07829587). Previously, I’d shown that the same discredited professional fundraiser had worked with failed military charity Afghan Heroes (AH; registered charity number: 1132340). I first wrote about PPL and its role with AH in January 2014, just after the Charity Commission announced in December 2013 that it’d opened a statutory inquiry into AH. That inquiry continues.

On 9 November 2014, I appeared for the first time as a live studio guest on 5 live Investigates, the BBC Radio 5 live programme. There we exposed PPL and its work for the two military charities. OLHF had told BBC Radio 5 live then that it would stop working with PPL – only to still be working together at the end of that year (see my 26 December 2014 post). In February 2015, I reported that the charity was finally working with another company, newly formed Targeted Management Limited (TML). Yet TML is owned by the same person behind PPL, Tony Chadwick. Unlike PPL, TML claims it isn’t a professional fundraiser; rather it’s a “management” company. Nevertheless TML appears to perform or have performed on behalf of OLHF some or all of the same activities as predecessor PPL (see my 11 August 2015 post).

In January 2015, PPL entered administration, which ended in December that year when the company was wound up by the High Court. Liquidators were duly appointed in February 2016. PPL remains in liquidation.

It wasn’t until March 2016 that the Charity Commission, the independent regulator of charities in England and Wales, published a highly critical case report on OLHF, identifying “serious regulatory concerns” (see my 4 April 2016 post). These include “a very low level” of charitable expenditure and “high” fundraising costs – only 20% of the money raised in its name actually goes to the charity, a fact I revealed back in 2014. (What took you so long, Charity Commission?) OLHF only avoided a statutory inquiry, the commission’s most serious form of engagement with a charity, because the trustees apparently showed an “open and responsible approach” in their dealings with the commission.

The commission’s case report raises many questions. Why exactly was the commission so lenient on OLHF? I’m not the only one: Stephen Cook, former editor of Third Sector, wrote a column in the charity sector magazine asking the same question: http://www.thirdsector.co.uk/charity-commission-lenient-once/governance/article/1390419. Why, too, did the commission fail to mention rip-off PPL and its role for the charity? The case report examined fundraising concerns involving TML only, without considering the relationship between that company and predecessor PPL, owned, of course, by the same person. A glaring omission.

But now I show that concerns about OLHF extend beyond fundraising. There’s a lack of clarity and transparency around the relationships between OLHF and the complex web of companies owned by the charity founder, Steve Pearson. The charity founder is also its chief executive and president.

The OLHF trustees’ annual report (TAR) with the most recent accounts, for financial year ending (FYE) 28 February 2015, documents payment of grants to beneficiaries for boiler installation. Similarly, grants for boiler installation appear on the “What we have done” page on the OLHF website (screen shot in Figure 1). As you can see, there are no dates on the page for the charitable activities. On 4 July 2016, I therefore asked Des White, chair of the charity, in an email for two dates. First, when did OLHF help “Sarah from Blackburn”? Second, when did it help “Peter from Blackpool”? No response a week later so I sent a reminder. At date of publication I’ve received nothing from the charity.

Figure 1. “What we have done” page on Our Local Heroes Foundation website at 23 June 2016

In a glowing testimonial, “Peter from Blackpool” praisesby name the company that fitted the boiler, Premier Property Maintenance. Indeed, he recommends them. So who are Premier Property Maintenance NW Limited (registered company number: 08933567)? Well, all three directors share the same surname – Pearson.First, there’s Steve Pearson, who founded OLHF. More about him and his exact role at the charity in a moment. Second, meet Antony Pearson, who was a trustee of the charity until 20 October 2015. Finally, we have Robert Pearson. Incorporated on 11 March 2014, at date of publication the company’s first accounts are eight months overdue at Companies House.

Premier Property Maintenance NW Limited isn’t actually on the Gas Safe Register, but another of Steve Pearson‘s companies is – B-Safe Property Services Limited (registered company number: 07501243). He’s the sole director. The Gas Safe registered engineer at B-Safe is familiar: Robert Pearson (screen shot in Figure 2). At date of publicationB-Safe‘s accounts are more than 2.5 years overdue at Companies House. The company is again threatened with being struck off for failing to file its accounts on time.

Figure 2. B-Safe on Gas Safe Register at 28 June 2016

Premier Property Maintenance NW Limited and B-Safe Property Services Limited are just two of Steve Pearson’s companies. He owns a complex web of companies, several of which have “Our Local Heroes” in their names: Our Local Heroes Monitoring Services Limited; Our Local Heroes Limited; and OLHF Events Limited (now renamed Challenger Events Management Limited). Warriors of Steel Limited is another in his empire: the charity held two fundraising events called Warriors of Steel, according to the TAR with the first OLHF accounts, for FYE 28 February 2012.

As I said, Steve Pearson is the charity founder. He’s been president since registration of OLHF as a charity on 20 May 2011, according to his LinkedIn page (screen shot in Figure 3). Mr Pearson is also chief executive: see http://www.garstangcourier.co.uk/centre-for-ex-servicemen-in-fowlers-hill-wood-causes-controversy-1-7087310. He runs the charity: see http://www.blackpoolgazette.co.uk/news/crime/collector-stole-cash-donated-to-war-heroes-1-7343277. There it says: “Run by businessman Steve Pearson, the charity finds employment for injured military veterans by setting up companies for them. If successful, the revenue from the ventures is invested to create further companies and more jobs.” But, as we’ve seen, there’s a lack of clarity and transparency around the relationships between OLHF and the complex web of companies owned by Mr Pearson. Here I’ve shown that money raised by the charity was used to fund work at a company owned by the charity founder, who’s also chief executive and president of the charity. A trustee of OLHF, with the same surname as the charity chief executive, is also director of the company.

Figure 3. Steve Pearson LinkedIn page at 28 June 2016

The charity had four trustees in its first year, three called Pearson. None of the now three trustees, though,have that surname. The chair of a charity usually line-manages the chief executive on behalf of the trustees (see the Charity Commission guide, “The essential trustee: what you need to know, what you need to do” (CC3)). Yet new chair Des White set up a company with Steve Pearson AFTER becoming a trustee on 16 February 2015. Community Covenant Housing Management Limited (registered company number: 09598436) was incorporated on 19 May 2015, with Mr White and Mr Pearson as the two directors and two shareholders. Mr White resigned as a director on 1 April 2016, but remains as a shareholder, according to the company’s annual return made up to 19 May 2016.Community Covenant Housing Management Limited is active with Mr Pearson as sole director. Mr White, meanwhile,is sole director of a new company with a similar name, Community Covenant Homes Ltd (registered company number: 09381764). He incorporated that company on 9 January 2015 – that is, BEFORE becoming a trustee of OLHF. He’s sole director, too, of another similar-sounding new company, Community Covenant Development Limited (registered company number: 09930786). Date of incorporation was 29 December 2015, so AFTER Mr White became a trustee. The registered office address of both Community Covenant Homes Ltd and Community Covenant Development Limited is the modestly titled Pearson House, also the address of the charity, according to its website and the Charity Commission public register. The links between Mr White and Mr Pearson are a potential concern: are the trustees only really in charge of the charity? The trustees must take joint responsibility for management ofOLHF and be able to challenge Mr Pearson, who could be perceived to bea single dominant individual at the charity. It was him, tellingly, not the then trustees, who spoke for OLHF to BBC Radio 5 live in our November 2014 programme, for example.

The arrangementsfor boiler installation revealed here and the previously documented fundraising concerns both prompt the same reasonable question: is the charity being used for inappropriate private gain?

STOP PRESS: Premier Property Maintenance NW Limited IS now on the Gas Safe Register for business registration number 520996 (screen shot in Figure 4). The trading name for that number on the register was changed from B-Safe (Figure 2) on 10 August 2016.